The board of directors of StanCorp Financial Group Inc. (SFG) approved an 18.2% hike in its annual dividend. The new dividend comes to $1.30 per share, up from last payout of $1.10.
The increased dividend will be paid on Dec 8, 2014 to shareholders of record as of Nov 24. Based on yesterdays’ closing share price of $68.57, the increased dividend implies a yield of 1.9%, better than the industy average of 1.69%. StanCorp Financial has a solid track record of increasing dividend every year, the latest marking the fifteenth in a row. The last dividend hike had been put to effect last November, with the board approving an 18.3% increase.
Based on 43.2 million shares outstanding at the end of the third quarter, StanCorp Financial will have to dish out around $56.2 million as dividend. Its liquidity position is sound enough to support the payout. The company ended the quarter with a cash balance of $263.3 million while retained earnings was solid at nearly $2.1 billion. Cash from operations in the first nine months totaled $218 million.
Apart from dividend hikes, StanCorp Financial also repurchases shares, which in turn lowers the share count and boosts earnings per share – another way to enhance shareholders’ value. The company has already bought back $33.2 million worth shares in the first nine months and has 2.4 million shares remaining under its buyback authorization. These efforts further testify to the company’s continued efforts to enhance shareholders’ value.
On the back of solid third-quarter results, the Zacks Consensus Estimate has been witnessing upward revisions as most of the estimates north over the last 30 days. The Zacks Consensus Estimate moved up 8.8% to $5.21 for 2014 and 1% to $5.59 for 2015. The momentum is expected to continue as analysts raise their estimates following the news that injects optimism into the stock.
StanCorp Financial presently carries a Zacks Rank #2 (Buy). Investors interested in insurers may have a look at Lincoln National Corporation (LNC), China Life Insurance Co. Ltd. (LFC) and ACE Limited (ACE). All these share the same Zacks Rank with StanCorp Financial.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report
To read this article on Zacks.com click here.
Get all Zacks Research Reports and be alerted to fast-breaking buy and sell opportunities every trading day.
Be the first to comment